Friday, November 4, 2011

Can my bank transfer my fixed-rate deal?

Q I have a fixed-rate mortgage with the Bank of Ireland. The fix is due to expire next year, at which point I expected to drop on to the standard variable rate (SVR) of 2.99%. However, Bank of Ireland has written to me saying that my mortgage has been selected to be transferred to a company called the Mortgage Works, which has a SVR of 4.79%.

Apparently I have no say in the matter, and while BoI says my terms and conditions remain the same I will have to pay the higher rate of interest charged by the Mortgage Works. This is obviously going to cost me a lot more. Is there anything I can do to stop this transfer going ahead? I'd rather stay with BoI and pay 2.99%. JS

A I'm afraid there is nothing you can do to stop the transfer going ahead. The terms and conditions of your mortgage allow the Bank of Ireland to sell part of its mortgage book ? ie transfer some of its lending to another lender ? whether you like it or not.

When the transfer to the Mortgage Works ? a wholly-owned subsidiary of Nationwide building society ? goes ahead on 3 December, there will not be any change to your fixed rate. But, when that expires, as you have been told, you will then go on to the Mortgage Works SVR which is higher than the SVR from the Bank of Ireland. However, when your fixed rate comes to an end, you should also be able to switch to another lender with a better interest rate.


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Source: http://www.guardian.co.uk/money/2011/nov/02/bank-of-ireland-transfer-mortgage

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